Longji shares (601012): Third quarter results in line with expected earnings increase cash flow growth
This report reads: Lungi shares seek for supply and demand for silicon wafers in 2019, non-silicon costs continue to decline, and the profitability of silicon wafers and components continues to increase in the third quarter. After the overall consolidation of components 杭州桑拿网 in 2020, high growth will be reproduced, maintaining an “overweight” rating. Investment Highlights: Maintain “Overweight” rating.Maintain the EPS of 2019-2021.33, 2.19, 2.65 yuan forecast, maintain the target price of 35.47 yuan.Longji’s Q3 single-quarter revenue was 85.8.2 billion, previously + 84%, net profit attributable to mothers in a single quarter15.54 ppm, + 305% a year, with revenue of 226 from January to September.9.3 billion yuan, + 55% for the whole year, net profit attributable to mother 34.8.4 billion, previously + 106%, performance was in line with expectations. Profitability has been comprehensively improved and cash flow has increased significantly.As the cost of non-silicon continues to fall, Q3’s gross profit margin increased by 2pct month-on-month to 30%, the expense ratio was well controlled and remained flat at 7% month-on-month.Operating cash flow from January to September reached 4 billion, an increase of 278% year-on-year, mainly due to an increase in sales receipts and advance receipts of 31.2 ppm, an annual increase of 224%, showing an increase in bargaining power.Expected Q3 silicon wafer expansion and contraction is close to 16.9.7 billion pieces, the volume of the component is close to 1.75GW, actual sales are close to 12.800 million pieces, the sales of modules are close to one.45GW.At the same time, it announced that it will build a 5GW module capacity in Jiaxing and continue to expand its advantageous capacity. Benefiting from a shortage of monocrystalline silicon wafers in 2019, major breakthroughs between components are expected in 2020.The orientation of the single crystal silicon wafer shows the shape of the long-ring double-oligonucleotide. In 2019, as the single crystal PERC battery downstream of the single crystal silicon wafer will significantly increase the production capacity by more than 30GW, the difference between the single crystal silicon wafers is unavoidable.At that point, the gross profit margin of 四川耍耍网 monocrystalline wafers has risen to 30%. In the long run, the oligopoly maintains a gross profit margin of 25% and a net profit margin of 15% is also very reasonable.At the same time, the scale of Longji’s double-sided modules is expected to exceed 40% in 2019, and it will also enhance profitability. Combining on-hand orders and long supply chain orders (including photovoltaic glass, module frames, etc.), 20GW sales of modules will be achieved in 2020, an increase of 100%.